ARM’S LENGTH MORTGAGES CLIENT WELCOME PACKAGE Length Mor… · > Mortgages are required to be on...

ARM’S LENGTH MORTGAGES

CLIENT WELCOME PACKAGE

CT21733 MAY2018

2 > Arm’s Length Mortgages — Client Welcome Package

Introduction to Arm’s Length Mortgages

An Arm’s Length Mortgage is an investment vehicle in which you lend money from your

registered account to a borrower. Provided that you and the borrower meet basic criteria as set

out in the Canadian Income Tax Act (the “Act”), you are at “arm’s length” and are permitted by

the Canada Revenue Agency (CRA) to offer an investor mortgage.

What are the requirements for an Arm’s Length Mortgage?

Mortgages must meet the following criteria to be eligible to be held in self-directed registered

accounts as Arm’s Length Mortgages with Computershare:

What mortgages are eligible as investments, and what plans can I keep them in?

> Only mortgages on new purchases and re-finances are eligible as registered investments.

> You can hold your mortgage invested in a self-directed account administered by Computershare,

including RRSPs, RRIFs, TFSAs and some locked-in accounts.

> You can use multiple plans administered by Computershare to fund a single mortgage. Each plan

will be administered separately as if the mortgages were unrelated.

> Computershare does not accept mortgages on leasehold properties, demand mortgages,

reciprocal mortgages, mortgages of lease or mortgages in foreclosure or involved in legal action

or in arrears.

Are there any requirements for appraisals or for the property itself?

> We require a current appraisal of property (within the last 6 months), issued by a licensed AACI

or CRA real estate appraiser, or a property tax assessment for the current year.

> Mortgages are required to be on real property (residential or commercial) located in Canada and

registered in the applicable provincial Land Title Office.

What are my responsibilities as a lender?

As the lender, it is your responsibility to:

> Determine the terms and conditions of the mortgage.

> Determine the creditworthiness of the borrower.

> Determine the value of the property and the borrower’s equity in the property.

> Assess any other factors that may be relevant to you providing the mortgage.

> Set the interest rate (commercially reasonable), the term (maximum ten years), payment details

etc. through negotiation between you and the borrower.

How much cash do I need?

At the anticipated funding date of the mortgage, sufficient cash is required in the account.

Computershare will not liquidate an investment in the account to generate cash for you.


Payments

Computershare requires at least annual interest payments

based on semi-annual installments that are not in advance, or

simple interest calculations only.

Professional Advice Recommended

Like any investment, a mortgage investment involves a degree

of risk. Computershare, in our capacity as account administrator

and trustee, does not provide advice on such risks. We

recommend that you obtain professional advice and assess

any risks you may face with a mortgage investment, including

eligibility according to the Act.

Mortgage Terms

As would be the case with a traditional lender, such as a bank,

it is your responsibility to determine the terms and conditions

of the mortgage, assess the creditworthiness of the borrower,

property value, the borrower’s equity in the property, and other

factors relevant to make the mortgage investment. Terms,

including payments and interest, should reflect arm’s length

terms of comparable mortgages.

Mortgage Documents

The mortgage documents must be drawn up by a lawyer or

notary public, who also must disburse the mortgage proceeds.

You must use the services of a lawyer or notary public to

draw up the mortgage documents, arrange for registration

of the mortgage in the applicable provincial Land Title Office,

and to disburse the mortgage proceeds from the lender to

the borrower. If the lawyer or notary public who draws up the

documents also represents the borrower, we recommend that

you retain independent counsel to advise you on the transaction

and eligibility according to the Act.

Qualifications for RRSPs, RRIFs and TFSAs

As detailed above, you can hold a mortgage as an investment

in your RRSP, RRIF or TFSA if the mortgage is on real property

(residential or commercial) located in Canada, where the lender

is at arm’s length from the mortgagor/borrower.

Chattel mortgages (charges on mobile homes, boats, etc.),

agreements for sale, collateral security and Promissory Notes

are not eligible investments for RRSPs, RRIFs and TFSAs,

although they may be used as additional security to a standard

mortgage charge on real property.

Computershare will only accept mortgages on new purchases

and re-finances eligible as registered investments in RRSPs,

RRIFs and TFSAs.

We will not accept a mortgage for a self-directed RRSP, RRIF

or TFSA unless the lender signs the “Arm’s Length Mortgage

Investment Agreement and Direction” stating that the lender

and the borrower are at arm’s length for the purposes of the

Act. Computershare recommends that you obtain professional

advice to accurately determine whether you are at arm’s length

with the mortgagor.

Income Tax Act regulations state that a mortgage is a qualified

investment for an RRSP, RRIF or TFSA only if the property value

at least equals the total amount of the RRSP/RRIF mortgage

and all prior mortgages and charges.

Computershare will only accept mortgage investments that

have a total loan to value on all encumbrances that is less than

90% maximum.

Although Computershare has no responsibility to determine

whether a mortgage is a qualified investment for your RRSP,

RRIF or TFSA, it reserves the right at its sole discretion to refuse

to accept any mortgage if it is not satisfied that the mortgage is

a qualified investment or for any other reason.


Administration of your mortgage investment

As trustee of your RRSPs, RRIFs or TFSAs, Computershare

will be responsible for crediting payments received by

Computershare to your account.

You, as the lender, are responsible for:

> Assessing the risks and creditworthiness of the borrower and

mortgaged property.

> Seeking the appropriate professional advice to ensure the

mortgage investment is a suitable investment for your

particular situation, risk tolerance and investment time

horizon.

> Negotiating the terms of the mortgage transaction.

> Instructing your lawyer or notary public to prepare the

mortgage (or transfer of mortgage) documents and informing

your lawyer or notary public of Computershare’s requirements.

> Ensuring that the mortgage is properly prepared, signed

and registered with the correct priority (e.g. 1st mortgage,

2nd mortgage) and that all the mutually agreed upon

arrangements of the mortgage and any required disclosures

in regards to interest and cost of borrowing are clearly

documented.

> Ensure that a duplicate copy of the registered executed

mortgage or registered executed assignment of mortgage

document is provided to Computershare within 30 days of the

funding.

> Ensuring that mortgage payments are made directly to

Computershare.

> Collecting payments in arrears and determining any required

legal action.

> Commencing foreclosure actions or other proceedings

necessary to recover monies owed.

> Determining, to the extent you deem necessary, that the

property is adequately and properly insured at all times.

> Providing Computershare with all documentation requested.

> Providing approved payout statement to Computershare.

Please note that Computershare will not act as an intermediary

between you and the borrower. It is your responsibility to work

with the borrower to establish how they should contact you for

information about the mortgage, whether through your agent,

lawyer, notary public, broker, or directly.

What are the requirements for funding and

documentation of the mortgage?

You must have an eligible self-directed plan with Computershare

and have sufficient cash on hand to fund the mortgage and any

associated fees. If the assets in the plan are in bonds, mutual

funds, stocks, or other investments, you must liquidate before

the funding date of the mortgage.

To fund your mortgage investment you are required to provide

the following documents:

> Evidence signed by you that your lawyer or notary public has

the authority to request funds on your behalf.

> Property appraisal report issued by a licensed AACI or CRA

real estate appraiser, or a property tax assessment for the

current year.

> A signed copy of our Arm’s Length Mortgage Investment

Agreement and Direction form.

> Details of the funding date and the amount required.

> A Computershare Pre-Authorized Debit Agreement with a void

cheque from the borrower attached for monthly payments.

> A registerable mortgage signed by the borrower showing the

mortgage in favour of:

Computershare Trust Company of Canada

In trust for RRSP (or RRIF/TFSA) Account # _________________________

3rd Floor, 510 Burrard Street, Vancouver BC, V6C 3B9

> Confirmation from lawyer or notary public of total mortgage

charges including all prior encumbrances.

Please note that if the borrower is a company, you must also

provide a company search or a corporate resolution showing the

directors/officers of the company.


For Mortgages in British Columbia Involving Trusts

For Mortgages in British Columbia that involve trusts, the BC Land Titles office requires a copy

of the Declaration of Trust signed by the lender. Your lawyer or notary public may be required to

submit a copy of the Declaration of Trust form bearing your signature along with the mortgage

registration documents to BC Land Titles. In addition, if filed standard mortgage terms are used,

a receipt of standard mortgage terms document must be signed by the borrower.

Your lawyer or notary public must request funds from us at least two business days before

funding. The request must be emailed to [email protected].

Your lawyer or notary public will prepare the mortgage (or transfer of mortgage) documents and

to disburse the mortgage proceeds.

Appraisal of property value

Computershare requires lenders to provide an appraisal report of the property, within the last

6 months and is issued by a licensed real estate appraiser, or a property tax assessment for the

property for the current year. We require an appraisal from AACI (Accredited Appraiser Canadian

Institute) or CRA (Canadian Residential Appraiser). The appraisal must state that it has been

prepared for either the borrower or Computershare.

Registration of mortgage and title search

The lawyer or notary public must provide our office with the following, within 30 days of funding:

> A copy of the mortgage (or transfer of mortgage) showing registration details; and

> A title search or state of title certificate showing the registration of the mortgage.

Failure to provide the registered executed documents may result in the mortgage being

considered a non-qualified investment and potentially being removed from the registered plan,

which would be a taxable event.

Other information may be requested of you, or your lawyer or notary public, in connection with

the mortgage and subject property.

Release of funds

Once we have received of all required documentation, we will release funds within

two business days.

Mortgage Renewals

When your mortgage investment matures, as noted on the mortgage document filed at the Land

Titles Office, a mortgage renewal must be executed by the annuitant and mortgagor, and a copy

forwarded to Computershare for our files. The mortgage renewal will also ensure the correct

interest rate and new maturity date is reflected on your statements.

mailto:PCSmortgages%40computershare.com?subject=


Transfer of Existing Mortgage

In addition to funding new mortgages, you can use your

registered account to purchase all or part of an existing

mortgage, including all or part of a qualified Arm’s Length

Mortgage held by you outside of your RRSP, RRIF or TFSA. The

sale must be at fair market value supported by an appraisal. The

requirements for transferring existing mortgages are the same

as new fundings, as explained in this document. There may be

tax implications in respect of the transfer of mortgage, and

we recommend that you obtain professional advice regarding

transfers of mortgage.

In Kind Transfers of Arm’s Length Mortgages

If you hold an Arm’s Length Mortgage in another RRSP, RRIF

or TFSA with another bank or trust company, you may transfer

your whole eligible registered plan or a specific mortgage

holding to a new plan with Computershare.

Computershare requires the following to transfer your

registered plan and Arm’s Length Mortgage:

> If you do not currently have an existing RRSP, RRIF or TFSA

with Computershare, complete the Computershare New

Account Application Form and forward it to us.

> Complete a Transfer Authorization for Registered Investments

form indicating that the mortgage is to be transferred in kind

and is current and in good standing (i.e. not in foreclosure).

> Attach a copy of the asset listing from the relinquishing

institution showing this asset in your holdings.

> The same funding documents as listed in the Documentation

and Funding Requirements section above are required.

> The services of a notary or lawyer are required to draw

the transfer of a mortgage from the current trustee to

Computershare.

> The transfer document must be executed by the current

trustee and registered in a land titles office.

> Your lawyer or notary must follow all Computershare

documentation and funding requirements.

Mortgage Payments

The mortgage payments must be credited to the RRSP, RRIF or

TFSA. There are two ways this can be done:

1. Pre-Authorized Debit

With pre-authorized debit (PAD), the payment is deducted

directly from the borrower’s bank account and credited to your

account. A PAD is required for any mortgages with monthly

payments. You must use Computershare’s Pre-Authorized

Debit Agreement form completed in full and signed by the bank

account holders, along with a void cheque from the Mortgagor’s

bank account.

In the event of a payout, it is advisable to have the mortgagor

place a stop payment at their bank as a precaution. We do not

automatically cancel PADs upon receipt of a payout statement

unless instructed to do so by the lender at least five business

days before the next payment. There will be a ten-day hold

on all payments where a PAD was not stopped at the time of

payout and needs to be returned to the Mortgagor. Should there

be any returned payments, your account will be charged our

Returned Payment Fee.

2. Payments via a Mortgage Company

If you use the services of a mortgage company, they will collect

the payment on your behalf and forward it to Computershare.

In the case of a shared mortgage, a schedule of the specific

payments to each plan is to be provided with the cheque

or wire payment. In compliance with the Act, only wires or

cheques payable to Computershare, drawn on the mortgagor’s

bank account, will be processed to the plan. Please note that

Computershare does not accept post-dated cheques.

Payouts/Discharges

Upon receipt of a request for a payout from the borrower or

his lawyer or notary, Computershare will request a written

payout statement from you the lender. We will not process a

payout cheque until you have approved the payout amount and

provided us with a prepared registerable discharge of mortgage

for execution by Computershare, which can be prepared by

your lawyer or notary public or the borrower’s lawyer or

notary public.

Mortgage Arrears, Foreclosure and Legal Action

You are ultimately responsible for monitoring all payments,

collections of arrear payments and initiation of legal

proceedings to protect your mortgage investment. As

Computershare (the “Trustee”) is the legal mortgagee under

RRSP, RRIF and TFSA mortgages, foreclosure actions must be

commenced in the name of the Trustee.


However, the decision to foreclose remains with you, the lender,

and not Computershare, the trustee. We strongly suggest

you seek the appropriate legal advice before proceeding. If

foreclosure action is taken, Computershare will, upon request,

give written authorization to your lawyer to proceed on

our behalf. Computershare must receive a copy of all legal

documents for our file.

Upon sale of the mortgaged property, all proceeds in respect

of the repayment of the indebtedness under the mortgage

are required to be returned to the account and are to come

directly from the lawyer who is disbursing funds received

from the courts. You, the lender or annuitant, are solely

responsible for retaining a lawyer, who will act on your behalf.

You are also responsible and for payment of all expenses of the

enforcement process.

If automatic payments are affected by the foreclosure or if the

mortgage is the sole asset held in a self-directed account, the

PAD process will be terminated.

Your registered plan and Computershare may also be named in

other legal proceedings due to your mortgage investment on a

property, such as foreclosure proceedings initiated by another

mortgage holder. You are solely responsible for retaining

a lawyer, who will act on behalf of the registered plan and

Computershare. You are also responsible for any associated

costs to defend or enforce your mortgage investment.

You also agree to indemnify and save harmless Computershare

from any and all suits, claims, costs or actions resulting from

you investing your registered funds in the Arm’s Length

Mortgage, as well as all costs incurred by Computershare either

to defend itself from any such suits, claims, costs or actions or

to enforce this indemnity.

Fees

Computershare charges a one-time mortgage setup fee, due at

time of funding, and an annual mortgage holding fee.

Annual mortgage holding fees are charged annually in arrears

at the beginning of the anniversary month of your plan. The

holding fees are charged individually per plan, per mortgage.

For mortgages with multiple lenders, each lender will be

charged an annual holding fee for that particular mortgage.

Holding fees are pro-rated as per the following schedule after

the annual anniversary date of the plan: 0-30 days no fee,

31+ days full holding fee. At the end of the mortgage term, a

renewal or discharge fee will also be applied to the account

depending on your course of action with the borrower.

Other fees may apply. Please refer to our Fee Schedule included

in this package for a list of all our current fees.

Forms

We have attached our most frequently used forms for your

convenience. If you require additional forms you can download

them from our website, computershare.com.

1. Syndicated Mortgage Requirement Checklist

2. Arm’s Length Mortgage Investment Agreement

and Direction

3. Direction and Indemnification Relating to

Mortgage Investment

4. Direction and Indemnification Relating to

Syndicated Mortgage Investment

5. Solicitor’s Certificate of Disclosure and Undertaking

6. Acknowledgement of Receipt

7. Arm’s Length Mortgage Pre-Authorized Debit Agreement

8. Fee Schedule

https://www-us.computershare.com/Investor/help/PrintableForms?cc=ca&lang=en

Below are the general funding requirements for a Syndicated Mortgage to be held in a registered plan at Computershare Trust

Company of Canada.

In order to approve a Syndicated Mortgage as a qualified investment for investors at Computershare, please provide the

following documents:

1. Legal Opinion from a recognized lawyer:

a. The letter should be addressed to Computershare, and advising that the investment is a qualified investment for tax

deferred plans. The Opinion Letter is to advise Computershare the qualified investment type and what section of the

Income Tax or Regulations that they are qualified under.

b. If the mortgage is not to be registered in the name of Computershare Trust Company of Canada in trust for the plan

holder, the letter should also confirm that the registered party holding the mortgage is a bare trustee.

2. Mortgage Participation Agreement.

3. Project Fact Sheet / Summary of the loan.

4. AACI or CRA designated appraiser signed property appraisal report confirming the property value. The report must be issued

within the last 6 months.

5. Corporate Search / Status Search of the Borrower (if the borrower is a company).

6. Confirmation of the broker / bare trustee being in good standing.

7. Confirmation of no active legal action / litigation on title.

8. Draft Mortgage / Registered Mortgage & Draft Transfer of Mortgage.

9. Up to date Title Search / State of Title Certificate.

10. Confirmation of all prior encumbrances. Please note the requirement on total loan to value ratio is within 90%.

11. Arm’s Length Mortgage Investment Agreement and Direction (Computershare’s form).

12. Direction and Indemnification Relating to Syndicated Mortgage Investment (Computershare’s form).

13. Solicitor’s Certificate of Disclosure and Undertaking (Computershare’s form)

SYNDICATED MORTGAGE REQUIREMENTS CHECKLIST

SYNDICATED MORTGAGE REQUIREMENTS CHECKLIST PAGE 1 OF 1

ARM’S LENGTH MORTGAGE INVESTMENT AGREEMENT AND DIRECTION

SECTION 1: CLIENT INFORMATION

Client Name Client Account Number

SECTION 2: INVESTMENT DIRECTION

I hereby direct Computershare Trust Company of Canada (“Computershare”), in its capacity as trustee of my RRSP / RRIF / TFSA (my “Registered Plan”), to lend out the assets of my Registered Plan, by way of a registered:

First Second Third Other: mortgage, (the “Mortgage”)

I hereby authorize Computershare to release the mortgage proceeds in the amount of $

to: “in trust”.

Mortgage is syndicated Yes No

Note to Annuitant: Computershare recommends that you obtain professional advice as to whether you and the Mortgagor deal at arm’s length for the purposes of the Income Tax Act (Canada).

SECTION 3: MORTGAGE DETAILS

Borrower/Mortgagor(s) (“Mortgagor”)

Property Address

Legal Description

Face Value of Mortgage (if different from amount advanced)

Discount Amount (with description of the discount)

Interest Rate Term & Amortization Period

Payment Amount Payment Frequency First Payment Date Maturity Date

Terms & Conditions

For good and valuable consideration, the receipt of which is hereby acknowledged by the undersigned, the undersigned hereby agrees to the below terms and conditions.

1. My instructions above are subject to the following terms and conditions, which are in addition to any other term, condition, representation, warranty or agreement previously or hereafter given by me to Computershare relating to my Registered Plan.

2. With respect to the Mortgage, the undersigned hereby agrees, represents and warrants to Computershare:

a. I deal at arm’s length with the Mortgagor for the purposes of the Income Tax Act (Canada).

b. I am the annuitant under the Plan.

c. I am not the Mortgagor.

d. If the borrower is a company, I do not own a controlling interest in the company.

e. If the borrower is a company, I am not related by blood, marriage or adoption to any of the individuals who own a controlling interest in the company.

f. I am aware of any restrictions on mortgage investments in my Registered Plan.

g. I have obtained such financial, investment, tax and legal advice, and carried out such due diligence, having regard to my personal circumstances, as I have considered appropriate.

h. I have neither sought nor obtained any advice from Computershare with respect to the Mortgage, including its eligibility or suitability as an investment for my Registered Plan.

i. I, with or without the assistance of my personal advisor(s), including any exempt market dealer or mortgage broker if applicable, negotiated the terms of the Mortgage. Computershare provided no advice or assistance with respect to the Mortgage loan, nor has it acted as an intermediary between me and the Mortgagor.

ARM’S LENGTH MORTGAGE INVESTMENT AGREEMENT AND DIRECTION PAGE 1 OF 2

j. Computershare’s role in respect of the Mortgage is solely that of trustee of my Registered Plan.

k. Computershare has neither undertaken any due diligence nor made any independent determination as to the status of the Mortgage as being a ‘qualified investment’, and not being a ‘prohibited investment’, for my Registered Plan, if applicable, as such terms are defined in the Act.

l. For so long as my Registered Plan holds the Mortgage, if applicable, I alone will be responsible for ensuring that the Mortgage remains a qualified investment and not a prohibited investment for my Registered Plan and I shall inform Computershare if the Mortgage ceases to be a qualified investment or becomes a prohibited investment for my Registered Plan.

m. Computershare is not responsible for determining the fair market value (“FMV”) of the Mortgage at the time of the Acquisition or thereafter. However, Computershare may record and may from time to time revise its recording of the FMV (or a value that it believes may be the FMV) of the Mortgage in its records, and may report such values to me, to any taxation or regulatory authorities, or to any advisor or third party that I may authorize.

n. If the Mortgage requires the execution by Computershare of any documentation of the Mortgagor or any other party involved in the transaction (“Documentation”), I certify I have reviewed or received independent advice on such Documentation, certify that same are in good form for execution, and direct Computershare to execute same.

o. Computershare may in its sole discretion refuse any instruction to acquire, or to continue to hold, any Mortgage in my Registered Plan and may cause the Mortgage to be removed from my Registered Plan. I agree to provide Computershare with any information it may require in connection with any Mortgage, including for compliance with securities legislation.

p. If my instructions to Computershare to advance the mortgage loan do not include express terms to the contrary, I acknowledge that delivery to Computershare of any certificate or other document representing or confirming the Mortgage loan, is the responsibility of myself and not of Computershare. If Computershare has advanced funds for the Mortgage from my Registered Plan but has not received adequate evidence or confirmation of the registration of the Mortgage in my Registered Plan within 60 days of the purported acquisition, it may treat such paid funds as being de-registered from my Registered Plan, and I acknowledge the adverse tax consequences that would follow.

q. I, and not Computershare, am responsible to ensure that the mortgagor has good title to the real property purporting to be security for any Mortgage, that the Mortgage is sufficient to effectively charge the real property or to transfer title thereto to the undersigned or to Computershare, that adequate, or any, insurance coverage is placed or maintained in respect of the real property secured by a Mortgage, that taxes are paid in respect thereof or that any other covenants whatsoever, and for monitoring the Mortgage, including whether payment of any interest has been received.

r. All payments by the mortgagor on any Mortgage which Computershare holds pursuant to the terms hereof and of the Registered Plan shall, unless and until notified otherwise in writing by Computershare, be made directly to Computershare and I will execute and deliver or cause to be executed and delivered all such directions as may be necessary or desirable in order that such payments be made to Computershare.

Further, Computershare’s only responsibility relating to any interest payment is to deposit any payment that it receives into my Registered Plan. Computershare will not be responsible for investigating, pursuing or enforcing any such interest payment obligation of a mortgagor, or for confirming the correctness of any amount received.

3. I acknowledge that the purchase of the Mortgage may be a high risk investment and that I am aware that in directing Computershare to purchase the Mortgage on my behalf, I may be at risk of losing all of the money invested in such purchase.

4. It is my responsibility to deal with all matters relevant to the investments in my Registered Plan, at the time of any acquisition and thereafter, including the value, terms and conditions of the Mortgage, the creditworthiness of the mortgagor, the nature and outlook for its business, the quality of its management and all other relevant considerations, including the suitability of the investment in the Mortgage by my Registered Plan having regard to my financial circumstances and financial goals. Computershare is not in the business of providing investment advice, has provided me with no such advice, and is not responsible for any decision I may make as to an acquisition or the retention of any investment in my Registered Plan.

5. Computershare reserves the right to have any asset in my Registered Plan, or that is subject to my instruction or any transaction in my Registered Plan, reviewed by its solicitors, and the costs of such review will be paid by me or from my Registered Plan.

6. I agree to indemnify and save harmless Computershare from any and all suits, claims, costs or actions whatsoever resulting from my investing my Registered Plan funds in the above mentioned Mortgage, as well as all costs incurred by Computershare either to defend itself from any such suits, claims, costs or actions or to enforce this indemnity.

7. For a listing of Computershare’s fees regarding my Registered Plan, I can refer to its fee schedule, located at www.computershare.com or it is available upon request.

I hereby agree to all of the foregoing and authorize Computershare to provide to the mortgagor all relevant requested financial

information pertaining to this transaction. I confirm the above instructions and agree to the Terms and Conditions above.

Client’s Signature Year/Month/Day

Deliver form to:

Computershare Trust Company of Canada,

Attn: Private Capital Solutions

3rd Floor, 510 Burrard St.,

Vancouver, BC V6C 3B9

Email: [email protected]

ARM’S LENGTH MORTGAGE INVESTMENT AGREEMENT AND DIRECTION PAGE 2 OF 2

DIRECTION AND INDEMNIFICATION RELATING TO MORTGAGE INVESTMENT

To: COMPUTERSHARE TRUST COMPANY OF CANADA (the “Trustee”)

By: (“Account Holder”)

(“Account”)

Re: Mortgage Investment by my RRSP / RRIF/ TFSA

I, the Account Holder, hereby direct, acknowledge, agree or certify, as follows:

1. I direct that my Account make a mortgage loan, which loan is secured by real property situated in Canada and which is described as

“ ” (the “Mortgage” and “Property”), and I further direct that the Trustee

execute any Lender/Investor Disclosure Statements and/or Purchase Agreements or any such documentation as provided to you for this purpose.

2. I certify, after due investigation, that the Mortgage is a qualified investment for my Account pursuant to Regulation 4900(1)(j) of the Income Tax Act. I

further certify that the mortgagor or chargor is a person with whom I deal at arm’s length.

3. I agree that the Mortgage shall be accompanied by such legal documentation as may in the discretion of the Trustee be necessary or desirable to give

it full legal effect, including without limitation a duplicate registered copy of the Mortgage and/or a registered assignment as applicable. The Mortgage

shall be in the name of the Trustee or its nominee as mortgagee.

4. I will be responsible for ensuring that all payments by the mortgagor on the Mortgage shall be made directly to the Trustee.

5. I agree that the Trustee shall be under no obligation whatsoever to ensure that the mortgagor has good title to the real property purporting to be security

for the Mortgage, that the Mortgage is sufficient to effectively charge the property or to transfer such title to the Trustee, that the Mortgage is, and

remains, sufficient to secure full repayment of the mortgage loan, that adequate, or any, insurance coverage is placed or maintained in respect of the real

property secured by the Mortgage, that taxes are paid in respect thereof or that any other covenants whatsoever, other than payments of principal and

interest, contained in the Mortgage are being performed by the mortgagor.

6. I agree that the Trustee may take such action as it deems necessary or desirable in respect of any default coming to its attention and shall be fully

protected in doing so and I understand that the Trustee shall give me notice of such action; but taking such action shall in no way obligate the Trustee to

take any other or further action with respect to the same or any other default.

7. The Trustee shall be entitled to receive and be paid out of the Account all costs and expenses whatsoever incurred by the Trustee in making and

holding the Mortgage as an investment, including in particular an annual mortgage administration fee, all registration fees and taxes and all fees and

disbursements of any legal counsel or other professional advisors retained by the Trustee in its sole discretion in connection with the administration of

the Mortgage, except to the extent that the same may be borne by a mortgagor under such Mortgage, and the Trustee shall have no obligation to ensure

payment thereof by any such mortgagor.

8. I acknowledge and agree that the Trustee is not in the business of giving investment advice, and that it is solely my responsibility to ensure that any

investments I may elect to make for my Account from time to time will provide me with the necessary degree of liquidity and marketability in order to meet

and fulfill my personal investment objectives and that the Mortgage may not fulfill these objectives.

9. I agree to indemnify and hold harmless the Trustee and any of its officers, employees, affiliates, associates, agents and assigns, from and against

all claims, demands, actions, suits or other proceedings by whomsoever brought, and from all losses, costs, damages, expenses (including any legal

fees and disbursements on a solicitor and client basis and any costs incurred in connection with the enforcement of this indemnity), taxes, penalties

and other liabilities whatsoever, directly or indirectly arising from or in connection with its acting in good faith in accordance with this Direction and

Indemnification, its holding of the Mortgage, or due to any misstatement or breach of representation, warranty, agreement or certification made herein.

This indemnification shall survive the termination of or transfer out of the Account or its assets or the resignation or revocation of the trusteeship of the

Account by the Trustee.

10. I acknowledge that I have had the opportunity to seek and obtain independent financial, investment, tax and legal advice and have done so to the extent I

deemed necessary and appropriate prior to directing the acquisition of the Mortgage and executing this Direction and Indemnification.

Dated this day of , 20 . Print Name of Witness

Signature of Account Holder Signature of Witness

Privacy Notice Computershare is committed to protecting your personal information. In the course of providing services to you and our corporate clients, we receive non-public personal information about you – from transactions we perform for you, forms you send us, other communications we have with you or your representatives, etc. This information could include your name, address, social insurance number, securities holdings and other financial information. We use this to administer your account, to better serve your and our clients’ needs and for other lawful purposes relating to our services. Computershare may transfer personal information to other companies in or outside of Canada that provide data processing and storage or other support in order to facilitate the services it provides. We have prepared a Privacy Code to tell you more about our information practices, how your privacy is protected and how to contact our Chief Privacy Officer. It is available at our website, www.computershare.com, or by writing us at 100 University Avenue, Toronto, Ontario, M5J 2Y1.

DIRECTION AND INDEMNIFICATION RELATING TO MORTGAGE INVESTMENT PAGE 1 OF 1

DIRECTION AND INDEMNIFICATION RELATING TO SYNDICATED MORTGAGE INVESTMENT

To: COMPUTERSHARE TRUST COMPANY OF CANADA (the “Trustee”)

By: (“Account Holder”)

(“Account”)

Re: Mortgage Investment by my RRSP / RRIF/ TFSA

I, the Account Holder, hereby direct, acknowledge, agree or certify, as follows:

1. I direct that my Account lend $ (the “Mortgage Investment”) in a syndicated mortgage of

$ to (issuer name Loan # and referred to herein as

the “Syndicated Mortgage”) which Syndicated Mortgage is to be secured by real property situated in Canada and which is described as

“ ”. I further direct that the Trustee execute any Lender/Investor Disclosure Statements

and/or Purchase Agreements or any such documentation as provided to you for this purpose.

2. I certify, after due investigation, that the Mortgage is a qualified investment for my Account pursuant to Regulation 4900(1) (j) of the

Income Tax Act. I further certify that the mortgagor or chargor is a person with whom I deal at arm’s length.

3. My Mortgage Investment in this Syndicated Mortgage, which has been originated by

(“issuer name”), will be administered by pursuant to a Mortgage Participation Agreement

(“MPA”), a copy of which will be provided to the Trustee together with such other documents as be necessary or desirable to give it

full legal effect, including without limitation a duplicate registered copy of the Mortgage and/or a registered assignment as applicable.

My Mortgage Investment forming part of the Syndicated Mortgage shall be in the name of as

bare trustee, nominee, and administrator of the Syndicated Mortgage for and on behalf of myself as a beneficial owner, the Trustee, as

Trustee of the Account, and all other investors in the Syndicated Mortgage pursuant to the terms of the MPA for such mortgage and in

accordance with each party’s pro rata interest in the Syndicated Mortgage.

4. I am responsible for ensuring that all payments payable by the mortgagor on the Syndicated Mortgage are paid to

as Administrator and that forwards my pro rata share of

such payments to the Trustee within 48 hours of receipt by .

5. I acknowledge that shall have all responsibilities to manage the Syndicated Mortgage and agree

that the Trustee shall be under no obligation whatsoever to ensure

a. that the mortgagor has good title to the real property purporting to be security for the Syndicated Mortgage,

b. that the Syndicated Mortgage is sufficient to effectively charge the property or to transfer such title to

.

c. that the Syndicated Mortgage is, and remains, sufficient to secure full repayment of the mortgage loan,

d. that adequate, or any, insurance coverage is placed or maintained in respect of the real property secured by the

Syndicated Mortgage,

e. that taxes are paid in respect thereof or that any other covenants whatsoever, other than payments of principal and interest,

contained in the Syndicated Mortgage are being performed by the mortgagor,

f. that the borrower makes any or all payments due under the Syndicated Mortgage,

g. that is or has performed its duties and obligations pursuant to the terms of the MPA for

the Syndicated Mortgage

6. I direct the Trustee to take such action as it deems necessary or desirable in respect of any default coming to its attention and shall

be fully protected, released, and indemnified in doing so and I understand that the Trustee shall give me notice of such notice to

; but giving such notice shall in no way obligates the Trustee to take any action directly or any

other further action with respect to the same or any other default.

DIRECTION AND INDEMNIFICATION RELATING TO SYNDICATED MORTGAGE INVESTMENT PAGE 1 OF 2

7. The Trustee shall be entitled to receive and be paid out of the Account all costs and expenses whatsoever incurred by the Trustee in

making and holding my Mortgage Investment in the Syndicated Mortgage as an investment, including in particular an annual mortgage

administration fee, all registration fees and taxes and all fees and disbursements of any legal counsel or other professional advisors

retained by the Trustee in its sole discretion in connection with the Syndicated Mortgage, except to the extent that the same may be

borne by a mortgagor or under such Syndicated Mortgage, and the Trustee shall have no

obligation to ensure payment thereof by any such mortgagor or .

8. a) I acknowledge and agree that the Trustee is not in the business of providing investment advice, and has not given investment

advice in respect of the Syndicated Mortgage, and that it is solely my responsibility to ensure that any investments I may elect to make

for my Account from time to time, including without limitation in respect of the Syndicated Mortgage, will provide me with the necessary

degree of liquidity and marketability in order to meet and fulfill my personal investment objectives and that the Syndicated Mortgage may

not fulfill these objectives.

b) I acknowledge that the Trustee is not in the business of providing investment advice, and has not given investment advice in respect

of the Syndicated Mortgage, and that the Mortgage Investment in the Syndicated Mortgage may be a high risk investment. I am also

aware that in directing the Trustee to transfer funds from my Account as loan funds in respect of the Syndicated Mortgage on my behalf

as set out above, I may be at risk of losing all of my Mortgage Investment in this Syndicated Mortgage and the Trustee has no liability

whatsoever to me for any such loss.

9. I agree and hereby do release, hold harmless, and indemnify the Trustee and all of its officers, directors, employees, affiliates, associates,

agents and assigns, from and against all claims, demands, actions, suits or other proceedings by whomsoever brought, and from all losses,

costs, damages, expenses (including any legal fees and disbursements on a solicitor and client basis and any costs incurred in connection

with the enforcement of this release and indemnity), taxes, penalties and other liabilities whatsoever, directly or indirectly arising from

or in connection with its acting in accordance with this Direction and Indemnification and any action arising herefrom, including, without

limitation, in respect of and in connection with (i) the Mortgage Investment, (ii) the Syndicated Mortgage, and (iii) any or due to any

misstatement or breach of representation, warranty, agreement or certification made herein. The release and indemnification herein shall

survive the termination or expiry of this agreement, or transfer out of the Account or its assets or the resignation or revocation of the

trusteeship of the Account by the Trustee.

10. I acknowledge that I have had the opportunity to seek and obtain independent financial, investment, tax and legal advice and have

done so to the extent I deemed necessary and appropriate prior to directing the making of the Mortgage Investment in the Syndicated

Mortgage and executing this Direction and Indemnification.

Dated this day of , 20 . Print Name of Witness

Signature of Account Holder Signature of Witness

DIRECTION AND INDEMNIFICATION RELATING TO SYNDICATED MORTGAGE INVESTMENT PAGE 2 OF 2

SOLICITOR’S CERTIFICATE OF DISCLOSURE AND UNDERTAKING

TO: COMPUTERSHARE TRUST COMPANY OF CANADA (“Computershare”)

ARM’S-LENGTH MORTGAGES AS INVESTMENTS IN A REGISTERED PLAN

Agreement and Acknowledgement

I, of the firm of

practicing in the City of , Province of ,

acknowledge that my services have been retained by .

(please initial the appropriate box(es) if applicable and complete):

The mortgagor, namely:

I have disclosed to the lender/investor that I do not represent him/her and cannot protect his/her interests in connection

with the transaction,

I have advised the lender/investor to seek independent legal advice, in accordance with the Rules of Professional Conduct

of the Law Society of this province;

The lender/investor, namely

I have disclosed to each of the mortgagor and the lender/investor of the conflict in acting for more than one party;

Both the mortgagor and the lender/investor named above; ; to prepare and register a

First Second Third Other: mortgage (mortgagor’s name)

on the following property:

Civic Address:

Legal Description:

in favour of Computershare Trust Company of Canada in trust for RRSP/RRIF/TFSA number

I have no interest, direct or indirect, in the mortgage or the property

I understand that Computershare, will, upon receipt of a duly executed “ARM’S LENGTH MORTGAGE INVESTMENT AGREEMENT AND

DIRECTION” from the lender/investor, advance funds to me, in trust, from the lender/investor’s RRSP, RRIF or TFSA.

I undertake to hold these funds in escrow until fulfillment of all applicable conditions including registration in the appropriate Land Title

Register of a valid and enforceable mortgage on the property described above.

I further undertake to provide Computershare with a copy of the mortgage, duly registered, within 30 days of the advance of the funds to

the mortgagor and provide a copy of such registration confirming a valid registration of the Mortgage.

I acknowledge that this Certificate of Disclosure and Undertaking is a requirement of Computershare intended for the sole use and benefit of

the lender/investor and further declare that I am not acting for Computershare, that I am not taking instructions from Computershare, and

that Computershare or its affiliates have no obligation towards me or the mortgagor in connection with this transaction.

If the transaction contemplated is not completed, I undertake to return the funds to Computershare, for deposit in the lender’s/investor’s

RRSP, RRIF or TFSA.

Signed this day of ,20 .

Solicitor’s Signature

I have read the foregoing and I am satisfied with its content. I understand that this certificate is required by Computershare for my benefit

only and that Computershare makes no representation as to the veracity and/or accuracy of its content nor has any obligation to make any

verification or investigation in this regard.

Signed this day of ,20 .

Lender/Investor Signature

(Rank of Mortgage)

SOLICITOR’S CERTIFICATE OF DISCLOSURE AND UNDERTAKING PAGE 1 OF 1

ACKNOWLEDGEMENT OF RECEIPT (FOR BRITISH COLUMBIA MORTGAGES)

To: Computershare Trust Company of Canada

Re: Mortgage (the “Mortgage”) dated on or about the date hereof to be executed by the undersigned in favour of

.

The undersigned acknowledges receipt, prior to execution of the Mortgage, of the attached true copies of the following:

(a) the set of standard mortgage terms incorporated in the Mortgage and filed in the land title offices in

British Columbia under no. ; and

(b) Part 1 of the Mortgage, which Part is comprised of a Form B, D and/or E, including in item 10 thereof a statement of any modifications

(by way of additions, amendments or deletions) to the above-mentioned standard mortgage terms.

Date: , 20 .

Borrower Name Signature

ACKNOWLEDGEMENT OF RECEIPT PAGE 1 OF 1

ARM’S LENGTH MORTGAGE PRE-AUTHORIZED DEBIT AGREEMENT

SECTION 1: BORROWER/PAYOR INFORMATION

Last Name First Name and Initials

Joint Account Holder Last Name

Joint Account Holder First Name and Initials

SECTION 2: PRE-AUTHORIZED DEBIT INFORMATION (PAD)

Please select option

Set up New Debit Instructions Modify Existing Debit Instructions Cancel Existing Debit Instruction Frequency

Financial Institution Information

Please note a valid Canadian bank account is required to participate in a Pre-Authorized Debit. Requests must be received

no later than 10 business days before the payment date.

Financial Institution Account Number

Branch Transit Number

Financial Institution Number

Exact name(s) in which the above account is held:

SECTION 3: PRE-AUTHORIZED DEBIT (PAD) INSTRUCTIONS

Note: A minimum notification of five (5) business days prior to the next PAD payment is required to change or process PAD instructions.

Commence PAD (see table for details) 1st payment date: Change Next PAD date to:

Change existing fixed PAD amount (see table for details) Change banking information for PAD (see attached void cheque)

Payment Frequency: Monthly Quarterly Semi-Annually Annually

Payment Date: Pay on the 1st Pay on the 15th

Computershare Plan / Annuitant Name Dollar Amount ($)

Computershare Plan / Annuitant Name Dollar Amount ($)

SECTION 4: AUTHORIZATION OF HOLDER(S) OF BANK ACCOUNT

By signing below, I/we agree to the Terms & Conditions set out below

Signature(s)

Year Month Day

Instructions

1. Select either Set up New Debit Instructions, Modify Existing Debit Instructions or Cancel Existing Instructions.

2. If setting up new debit instructions or modifying existing debit instructions, enter the Financial Institution Account Number, Branch Transit

Number and Financial Institution Number. Print the exact name(s) in which the account is held as it appears on your personal cheque

or on the records of your Financial Institution. A VOID cheque indicating the name(s) on the bank account or a letter from your financial

institution confirming your banking details and the names associated to the account must be submitted with this form.

3. If cancelling existing debit instructions, enter the original bank details. No void cheque is required.

ARM’S LENGTH MORTGAGE PRE-AUTHORIZED DEBIT AGREEMENT - PCS FORM 005 PAGE 1 OF 2

Terms & Conditions

1) By signing this form, I/we authorize Computershare’s client (the lender, hereinafter referred to as the “Planholder”), to debit the account held at the financial institution indicated on this agreement, the amounts noted above and in the frequencies instructed. I/We agree that payments shall be made by preauthorized debit or electronic withdrawals or in such manner as Computershare may determine. I/we understand that the branch of the financial institution where the account is held is not required to verify that the payment is drawn in accordance with this authorization.

2) Computershare is authorized to accept changes to this agreement from the Planholder in accordance with the policies of Computershare.

3) I/We acknowledge and agree that I am/we are fully liable for any charges incurred if the debits cannot be made due to insufficient funds or any other reason for which I/we may be held accountable

4) I/We may change these instructions at any time, provided that Computershare receives at least 5 business days notice by mail or fax. I/We may cancel this plan at any time, provided that Computershare receives 30 days notice by mail or fax. To obtain a copy of a cancellation form or for more information regarding my/our right to cancel a pre-authorized debit agreement, I/we may consult with my/our financial institution or visit the Canadian Payments Association website at cdnpay.ca.

5) Pre-Authorized Debit (PAD) Details I/We hereby authorize Computershare Trust Company of Canada to make the requested debits of funds from the bank account. I/We acknowledge that this service is for personal PAD purposes. I/We acknowledge that if my/our signed PAD Agreement is not received within 10 days of the transaction date Computershare may not be able to process my/our authorization in time for that transaction and the authorization will be processed commencing the next transaction date. I/We have certain recourse rights if any debit does not comply with this agreement. For example, I/we have the right to receive reimbursement for any debit that is not authorized or is inconsistent with this PAD Agreement. To obtain more information on my/our recourse rights. I/we may contact my/our financial institution or visit cdnpay.ca.

6) Pre-Authorized Debit (PAD) Waiver Details I/We waive any requirement for Computershare to send me/us written notice prior to the first PAD made under this agreement or prior to implementing any modifications I have requested.

7) Privacy Notice Computershare is committed to protecting your personal information. In the course of providing services to you and our corporate clients, we receive non-public personal information about you – from transactions we perform for you, forms you send us, other communications we have with you or your representatives, etc. This information could include your name, address, social insurance number, securities holdings and other financial information. We use this to administer your account, to better serve your and our clients’ needs and for other lawful purposes relating to our services. Computershare may transfer personal information to other companies in or outside of Canada that provide data processing and storage or other support in order to facilitate the services it provides. We have prepared a Privacy Code to tell you more about our information practices, how your privacy is protected and how to contact our Chief Privacy Officer. It is available at our website, www.computershare.com, or by writing us at 100 University Avenue, Toronto, Ontario, M5J 2Y1.

ARM’S LENGTH MORTGAGE PRE-AUTHORIZED DEBIT AGREEMENT - PCS FORM 005 PAGE 2 OF 2

Fee Schedule

PRIVATE CAPITAL SOLUTIONS > Investment Account Fees

ANNUAL ADMINISTRATION FEE First Registered Account $125.00 Any Additional Registered Accounts (Includes All Registered Accounts) $75.00 Non-Registered Accounts $75.00 TRANSACTION FEES Trade Settlement (Exchange of cash for securities or securities for cash) $100.00 WITHDRAWAL / TRANSFER FEES Full Deregistration/Withdrawal /Transfer – RRSP / RRIF* $250.00 Full Deregistration/Withdrawal/Transfer – TFSA/Non-Registered* $150.00 Partial Deregistration/Withdrawal/Transfer – Cash** $50.00 Partial Deregistration/Withdrawal/Transfer – In Kind** $75.00 Scheduled Payments via EFT (RRIF/LIF/LRIF/PRIF/RLIF/TFSA) N/C Scheduled payment changes (one free per year) $50.00 Transfer of Publicly Traded Securities (into or out of any account / broker fees may apply) $50.00 * In addition to annual administration fee. ** 2 free TFSA cash or in-kind transfers per year - not including reregistration. Any Partial Deregistration/Withdrawal/Transfer resulting in less than $500 of assets in the account will be subject to a Full Deregistration/Withdrawal/Transfer fee. MORTGAGE FEES Arm’s Length Initial Setup (per mortgage) $100.00 Annual holding fee (per mortgage) $150.00 Mortgage discharge $25.00 Execution of mortgage documents (per borrower) $50.00 Mortgage renewal $50.00 Non-arm’s Length Initial Setup (per mortgage) $325.00 Annual holding fee (per mortgage) $200.00 Mortgage discharge $100.00 Mortgage renewal $100.00 Other Mortgage Fees Subsequent purchase $25.00 Mortgage Assumption $50.00 Confirmation of mortgage payouts and requests $50.00 Mortgage payment schedule changes $25.00 OTHER FEES Certificate Reregistration * $100.00 Cheque Issuance Fee (no charge for Direct Deposit/EFT payments) $25.00 Estate Settlement $250.00 NSF, Cancelled or Returned Payment $50.00 Account Research (per hour) $50.00 Mailed Statement, per Statement (not applicable to annual statement) $10.00 Courier (minimum fee plus any additional costs over minimum courier fee) $50.00 Overdue Account Fee (Due on any amounts outstanding past 30 days) 2% per month * Fee applies for all certificate reregistrations, including both voluntary and mandatory redemptions. Annual Administration and Annual Mortgage Holding fees (“Annual Fees”) are charged annually in arrears in the month that the account was opened. If an account is transferred out within 30 days of the account opening, or within 30 days following any annual anniversary date of the account opening, no Annual Fees will apply. If an account is transferred out at any time other than within 30 days of the account opening or 30 days following any annual anniversary date of the account opening, full Annual Fees will apply. Transaction and Other Fees are charged at the time they are incurred. All fees are exclusive of any out-of-pocket expenses incurred during the administration of the accounts, and any applicable federal or provincial taxes. Brokerage fees will apply for all transactions requiring involvement of a licensed broker dealer. Computershare reserves the right to assess fees for extraordinary services not outlined in this fee schedule. Computershare also reserves the right to amend these fees from time to time at its sole discretion.

COMPUTERSHARE TRUST COMPANY OF CANADA 1 866 302 7096

CT21427 FEB2018

Fee Schedule




CT21427 FEB2018

Fee Schedule




CT21427 FEB2018

Date post:	07-Jul-2020
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